Gold prices are up over $30 in today’s trading, currently at $944.50. As the below chart (of GLD, the gold ETF) shows, gold prices have broken through the downtrend resistance line (see previous article) and have now risen higher than the previous high made at $936.

This is a very positive sign for gold prices. Breaking up through the first resistance meant that gold was out of its downtrend since hitting $1020. Now breaking the second resistance signals that the trend is now up (as opposed to sideways) and gold is looking to challenge its all time highs.

In its uptrend pattern since November, we could see a challenge of $1000 in a couple of months or less. Less appears the more likely option, since gold usually moves in exponential upswings and spikes upwards are more and more likely in the current market environment.

We are also noticing more positive signals in gold, such as the positive moving average crossover (where the 50dma breaks up through the 200dma) that is due any minute now. Also note the building strength in gold illustrated by the rising RSI.

As for our portfolio, our gold shares did handsomely today; AEM is up over 6%, KGC has gained 6%, AUY has done over 9% and GOLD more than 10%!

Hold onto your gold and gold stocks. We are on the move.

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Reader Comments (6)

Well , that was a nice update. I too noticed that the downtrend was broken to the upside , but wasnt aware of the second resistance indicating that the move would be UP as opposed to sideways as stated. Gold and the Gold stocks look strong indeed , and I was waiting for a close on a weekly above $920( two weeks consecutively). Question: why is your downtrend line where you have it marked INSTEAD of March High 2008 connect to JULY high 2008 , connect to Jan high 2009???That was my interpretation ( still broken). Thanks!!